The Keyhole makes observations about consumers, brands, ads, & marketing, through a predictive customer loyalty lens. Most marketing is ineffective to today's bionic consumer, given undifferentiated products, loss of "brandness," & hard to come by profits. Marketers talk about "engagement" but nobody seems to be doing a very good job measuring or integrating it into what they do & it shows! The Keyhole opens a dialogue on this subject & suggests real-world solutions with the marketing community.

Wednesday, July 31, 2013

In
a recent Brand Keys survey among that most-desired of demographics (men and
women, 18-49 years old), we asked about the animated TV series they watched
most often, here’s how the top-10 ranked:

Simpsons

Archer

Futurama

Family
Guy

Bob’s
Burgers

Venture
Brothers

Aqua
Teen Hunger Force

South
Park

American
Dad

King
of the Hill

You’ll
probably be hearing a lot of “D’ohs!” in the near future. Not because “The
Simpsons” was #1 on our list, but because the figure of one billion dollars is
being floated around as regards Twentieth Television, a unit of Fox TV’s
syndicated division, plan to market reruns of the network's long-running
animated comedy “The Simpsons.” Yes, a billion dollars! That’s
$1,000,000,000.00.

“The
Simpsons” is entering its 25th year on TV and even with 530 episodes in the
can, Fox has no current plans to cancel the series. The studio first syndicated
the show to TV stations 15 years ago, so syndication isn’t new. What is new is
that now they would license reruns to stations and cable channels at the same
time with no effects to current syndication deals.

So
as new episodes appear on Fox, you’ll see them syndicated on both broadcast and
cable. And if that sounds like something out of a continuous loop from an
“Itchy and Scratchy” episode, you wouldn’t be wrong. With broadcast and cable
needing to fill a nearly bottomless mobile-access maw 24/7/365, all the
platforms are looking for new content to solve that problem. Netflix and Amazon
have created their own shows, but ultimately that’s only a drop in the
entertainment bucket.

The
Animated Show Survey results represent responses from 4,200 respondents, and is
part of Brand Keys’ soon-to-be-reported 10,000-households “2013 Back to School”
Survey.

So
who might end up the new proprietors of the Springfield clan? FX, another News
Corp cable networks seems a likely suspect, with supposed rights of first
refusal, or even their nascent comedy network, FXX. Other potential buyers could
be Viacom (Comedy Central and Nick at Nite) or Turner Broadcasting. Or Netflix.

When
will we learn who’ll be the new beneficiary of all this syndication content?
For an answer we can only offer a quote from Homer Simpson himself: “When will
I learn? The answer to life's problems aren't at the bottom of a bottle,
they're on TV!”

Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: brandkeys.com. Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.

Wednesday, July 24, 2013

You know the saying “Nothing is more dangerous than an idea
when it’s the only one you have.” Well, maybe it’s a little more dangerous when
you have two! Sears does. Have two ideas, we mean. See what you think. They
come courtesy of, and with great sincerity, from Ed Lampert, Sears Chairman and
CEO:

Idea #2: Position the company to compete with Amazon and
eBay.If you think that there’s some kind of strategic brand
dissonance going on, you’re probably not alone. What number on a list of places
you’d consider buying, say, a $35,000.00 Rolex, or a $2,000.00 pair of Alaia
heels, or a Zac Posen or Chanel bag, would Sears be? In the top-3? Top-10?
Higher? Much higher?

A just-because-we-were-curious experiment (Full Disclosure:
this was over cocktails) among some friends at Per Se in New York City, one of
the top-rated and most-expensive restaurants in the city, where people who can
actually get a reservation could buy pretty much any luxury brand Mr. Lampert
could conceive, were asked where they’d shop for a list of 5 luxury items, and
nobody listed Sears. Nobody. When we raised the name “Sears” as a possibility,
we got strange looks from our dinner companions, and the bartender cut us off.
Nah, only kidding about the bartender. But not the strange looks. Which at the
very least proves that the value of an idea has nothing whatsoever to do with
the sincerity of the man who expounds it.

For the research purists among you, we will readily admit
that this was a qualitative sample, although we’re pretty confident in our
targeting. And yes, Mr. Lampert really intends to sell the luxe stuff online at
Marketplace, which is currently the 3rd largest online vendor by number of
visits but that, of course, takes into account items other than $600 Pour Victorie
boots, and still lags significantly behind Amazon and eBay.

Sears, well known for tools and appliances, never did very
well with their “Softer Side” commercials, a soft strategy they tried to make
inroads into higher-end, better designed fashion sales. And then had to move
back to hard sell. So moving very upscale, even on a once-removed basis? Well,
we’ll leave that to you to decide. But for a more generalizable POV we looked
at the 2013 Customer Loyalty Engagement Index, Sears ranks #6 of seven brands
we track in the Department Store category, but it also ranks 6th in the
rational loyalty and engagement driver, “Range of Merchandise” (where Christian
Louboutin shoes would be located), and the emotional engagement driver,
“Shopping Experience” (the operative word being “shopping”). Two critical
values when it comes to another category – Luxury Goods. Although in fairness, women
seem to get pretty emotional about the Louboutin brand, so even more emotional
engagement is going to be necessary to make this idea work.

And yes, every brand everywhere is looking to find ways to
provide exposure to their brands in what’s turned into a 21st century media-scape.
There are a lot of platforms out there – more everyday, in fact. But if the
past few years have taught us anything about the digital world and e-commerce,
it’s that it’s easy to be out there and it’s easy to target, but it’s not so
easy to engage. Just because you build it, doesn’t mean consumers are going to
come. Or, more importantly emotionally engage with the brand and buy.

So Sears – like many others companies – is trying out
e-commerce strategies, but most-recently reported revenues have declined 9%
with a $279 million loss, and same-store sales down about 3% this Quarter.
Sears is trying to create a more upscale clicks-and-mortar brand personality
via this integration. But long-term survival, it would seem is predicted to
come from the stores and not the site. So perhaps Mr. Lampert should re-think
this Sears Marketplace = Luxury Brands idea.

Is this a half-baked idea for the Sears brand? You know the
joke about a half-baked idea? It’s only OK as long as it’s in the oven. But come
to think about it, Sears does apparently have a pretty large inventory of
unsold Kenmores to put it in!

Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: brandkeys.com. Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.

Wednesday, July 17, 2013

Fifty years ago the phrase, “Made in the USA,” had
nationalistic and quality-assurance resonance for Americans. Then came the
“Global Marketplace” and here we are. But recently the phrase “Made in the USA,”
or the inference of the phrase – apparently in anticipation of newer smartphone
models - has been resurrected for Apple and Motorola ad campaigns.

The Apple ad focuses on a single visual of consumers using
Apple products. Part of the copy reads, “This is it. This is what matters. The
experience of a product. How it makes someone feel,” which, we have to admit, comes
pretty close to how we look at “brand engagement,” a more-how-you-feel definition
than a what-it-does characterization. Anyway, the ad goes on, “We’re engineers
and artists. Craftsmen and inventors. We sign our work. You may rarely look at
it. But you’ll always feel it. This is our signature. And it means everything.”
The tagline: “Designed By Apple in California.”

The Motorola (“a Google company”) campaign raises the brand
value stakes. Visually, the brand presented two people jumping into a lake (you
decide what that’s all about) and offers, “The first smartphone that you can
design yourself,” then asks consumers to imagine what’s possible “when you have
the best design, engineering and manufacturing talent located here in the USA.”
Their tagline: “Designed by you. Assembled in the USA.” So not just designed in
the USA like Apple, but assembled here too. Someplace the “manufacturing”
aspect got lost between the eighth line of copy and the tagline, but let’s not quibble.

The campaigns raise two questions for us: Does “designed” or
“assembled” actually matter? And perhaps more importantly, does this brand
position à la process create the impression that brand will better meet
expectations consumers hold for the Ideal Smartphone? If you think about it, nearly
half of the 300 respondents who evaluated both ads (M/F, 18-65 years of age,
top-two box likelihood to purchase an Apple or Motorola as next smartphone) have
lived their lives in the global marketplace, purchasing products designed,
manufactured, and assembled in foreign countries.

We’ve pointed this out before, but it’s worth repeating: a
brand saying something, and consumers believing it are two different things. If
you want believability, you attain that via emotional engagement, not just
emotional copy. Increased brand engagement – always a leading-indicator of
positive consumer behavior – doesn’t show up where the consumer doesn’t believe
the statement or if the statement is just not important to them. It has been
known for brands to create campaigns that focus on elements and values
important to them, but that don’t matter very much to consumers. For a detailed
description of the engagement assessment process, click here.

In the meantime, here’s how the ads performed:

Apple did better than Motorola, engaging both Apple and
Motorola loyalists with the key category value – “design.” Not so surprising
when you consider Apple quite literally invented organic design for mobile
phones. (Yes, yes, Motorola did create the “clamshell,” but that was nearly 20
years ago, and today consumers really do function in a
what-have-you-done-lately mode.) So yes, “Design” has always been a critical
component of the first-most important engagement driver in the smartphone
category, “Product Design and Brand Reputation.”

The Apple ad increased brand engagement on that driver by
30% among consumers likely to buy an iPhone as their next smartphone. Even
among those who were predisposed to purchase Motorola, their Apple brand
engagement rating via exposure to the Apple ad increased 23%. Brand engagement
for Motorola loyalists via “design” increased 16% for Motorola. Apple stalwarts ceded only 7% to the Motorola
brand. Oops! Probably not what Motorola was hoping for.

Both ads – for both consumer segments – did, equally well as
regards “assembly.” “Assembly” showed up as a value component in the 4th most
important engagement driver, “Brand Value and Support.” Motorola’s ad
straightforwardly leveraged that value, but only saw a 5% engagement increase in
both the Motorola and Apple respondent-segments, which might just indicate that
“assembly” has not yet become an important brand engagement factor for the
category. It may be something Motorola can really do, but if it doesn’t
facilitate emotional brand engagement, it doesn't really matter.

As to “Made in the USA,” we’ll have to wait to see whether
that value becomes a realistic option for brands. The FTC regulates that mark,
a country-of-origin designator, indicating that “all or virtually all” of the
product was made in the USA. “Assembled in the USA” can be used without
qualification when principal assembly of foreign components takes place in the
USA and the fabrication is considered to be the product’s “last substantial
transformation.”

Where might all this be heading? With China’s accelerating
economy, labor costs are forecast to climb. And after the recent factory
devastation in Bangladesh, more consumers are looking for ethically sourced
products, so we believe consumers would find real comfort and emotional
engagement from a “Made in the USA” brand position. Particularly with companies
like Walmart looking to boost sourcing of US products and with Chinese
consumers willing to pay a premium for them. So the shift to domestic
manufacturing may not be only a boon to the economy but to brand values as
well.

But only, of course, for the brands consumers believe can
truly produce on a promise that’s important to them.

Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: brandkeys.com. Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.

Wednesday, July 10, 2013

No joke. Barnes and Noble
CEO, William Lynch, resigned on Monday. The writing was on the wall, or
e-reader, well somewhere, that the B&Ns digital division had failed to turn
their e-readers and tablets into best sellers.

Surprise ending to this
story? Well, shouldn’t have been. Not from either a financial or emotional
engagement perspective. If you’ve been reading the financial reports, digitally
or on old-century newsprint, you can’t have missed the fact that Nook recently reported
nearly a 34% drop in sales. If you had paged through the Brand Keys’ Nook
emotional engagement assessments, you would have found that a real tearjerker
too.

We’ve been measuring e-readers
since there were e-readers. And while there are lots of categories where being
first-to-market gives you a substantive advantage, and though you’re probably
thinking e-readers was one of those categories, today that’s pretty much a
fairytale. New technology will, of course, attract early adopters. And while
they’re the ones who set the general plotline for the category, ultimately it’s
the rest of us who define the very specific emotional narrative thread that
brands must follow, if they want to show up as a marketplace best seller.

The biggest Nook flop had to
do with consumer expectations for the second most-important engagement driver, “Organic
Design,” where Nook always seemed to be playing catch-up with Apple and Kindle
and Samsung and Asus, and then ran into production/supply problems. The first
most-important engagement driver had to do with “Brand Value,” and the chain’s
misguided efforts to merge dead-tree physical books and e-book retailing
confused the brand tale they were trying to get the consumers to read. So for the
moment, let’s edit out the design and production problems and just look at most
recent “Brand Value” engagement ratings:

iPad 95%

Kindle 93%%

Samsung 90%

Asus 88%

Sony 85%

Nook 60%

We’re pretty sure none of you
require a math textbook to see why these kinds of ratings translate from how consumers
see the Nook brand to their most-recently published financial report. Emotional
engagement metrics are totally non-fiction. In fact, they are so prescient in
their ability to predict consumer behavior they might very well be science fiction.
Except they aren’t and they do.

Barnes and Noble said the
company is reviewing their strategic plan and will be making efforts to
re-write their org charts separating Nook from the brick-and-mortar stores, so we’ll
have to wait to see whether that’s turns out to be fact or fiction.

But as these are books being
sold, no matter the format, we feel confident in offering up some literary
advice – a quote from Shakespeare’s Julius Caesar, “The fault, is not in our
stars, but in ourselves.” Or in this case, the brand. Some engagement advice:
Get a better read on your brand and an understanding of what consumers really
expect and revise from there. And finally, some financial advice: Avoid Chapter
11. It can be a killer and the brand often ends up on the remainder table!

Tuesday, July 02, 2013

With July 4th soon upon us, many marketers are readying to
wrap their brands in the American flag and cue the marching bands. As part of a
brand values survey, we did a statistical “drill-down” to identify which of 197
brands were more associated with the value of “patriotism.” For 21st century,
socially networked hotwired-to-mobile-device consumers, saying it and being it are
two different things, the operative phrase being, well, “being it.”

Many emotional engagement values drive overall brand
engagement, so consumers evaluated 35 of them. But since marketers – domestic and
foreign – traditionally operate on the “Week Before Independence Day Marketing Theory,”
i.e., a patriotic, flag-waving, call-to-emotion backed by majorettes and fife
and drum corps will motivate consumers, we wanted to see which brands actually
led when it came patriotism.

If tracking brand growth and profitability has taught us
anything over the past couple of decades, it’s successful leveraging any individual
brand value has always had more to do with believability via emotional brand
engagement than brand awareness via ad budget. Certainly not company size or the
use patriotic themes. (Don't you wish you had 1$ every time Uncle Sam shows up
in an ad this coming week? Or 50¢ for every Red, White, and Blue leitmotif?)

No, consumers are expecting all this and whether patriotism
can be credibly and profitably leveraged to the brand’s benefit is always more a
question of whether that value is part of the brand’s equity, and whether consumers
truly acknowledge it on a deeply emotional and engaging basis. Slapping an
American flag on something and actually having an authentic foundation for
being able to slap an American flag on something are different and the consumer
knows it. More importantly, they act upon that knowledge.

So it seems manifest and reasonable that the brands that
showed up in the top-25, could each be called an ‘American Icon’ in the category
where they compete. Percentages indicate emotional engagement strength for the single,
individual value of “patriotism” the brand gets credit for.

Jeep (98%)

Hershey’s/Coca-Cola (97%)

Levi Strauss/Disney (95%)

Colgate (94%)

Zippo (93%)

Wrigley’s (92%)

Ralph Lauren (91%)

Kodak/Gillette (90%)

New Balance/Harley-Davidson (89%)

Budweiser/Marlboro (88%)

Ford (86%)

Louisville Slugger/Smith & Wesson (85%)

GE (84%)

John Deere/L.L. Bean (82%)

Walmart (81%)

Craftsman Tools/ Wilson Sporting Goods/Wrangler (80%)

We were curious about to see how the most patriotic of
patriotic brands, the United States armed services rated. The Coast Guard, Air
Force, Army, Marines, and Navy were all included in the study and, as you
probably guessed, each showed up rated very highly on the list. As this was primarily
a study of for-profit brands, we’re calling them out separately here and
thanking all of them for their service. Advertising and marketing
notwithstanding, this is Independence Day we’re talking about after all.

Sports teams showed up too: the Yankees, the Patriots, the
49ers, the Cowboys. If you’ve observed a genuine and consonant thematic when it
comes to patriotism and brands, you wouldn’t be wrong. Other brands that
appeared in the top-50 included Campbell’s, Gibson, GM, Jack Daniels, Kellogg’s,
McDonalds, the NFL, Playboy, Sears, and Whirlpool.

All this is not to say that other brands are not patriotic,
or that they don’t possess any patriotic resonance. They do. Rational aspects
like being an American company, or really being “Made in the USA,” or having
Nationally-directed CSR activities and sponsorships – all play a part in the
total make-up of any brand, generally, and as it regards its patriotic nature
and public face specifically.

But if you want to meaningfully differentiate via a brand
value, if there’s believability via strong emotional engagement, good marketing
just gets better. Another thing the past couple of decades has taught us is brands
that make that kind of connection always have a strategic advantage over
competitors when it come to the marketplace battle for the hearts, minds, and
loyalty of consumers.

Find out more about what makes customer loyalty happen and how Brand Keys metrics is able to predict future consumer behavior: brandkeys.com. Visit our YouTube channel to learn more about Brand Keys methodology, applications and case studies.

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The Keyhole: Peeking at 21st Century Brands

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About Us

Robert Passikoff, founder and president of Brand Keys, is a sought-after speaker and global thought leader on engagement and loyalty. He has pioneered work in these areas, creating the Customer Loyalty Engagement Index and the Sports Fan Loyalty Index. New York University’s communication school has declared Dr. Passikoff “the most-quoted brand consultant in the United States.”